Julian Le Vay: Thoughts on Government
  • Articles
  • About
  • Contact
  • Books
    • Competition for Prisons
  • Articles
  • About
  • Contact
  • Books
    • Competition for Prisons

It takes two to tango

15/1/2018

0 Comments

 
In outsourcing it takes two to tango - customer and supplier. Both share in success, and in failure.

Thus questions are now being asked about the role of Government in the massive failure of Carillion: in allowing the company to bid so low that its margins were unsustainable, and in continuing to award contracts last year long after it was clear that the company was in deep trouble and might fold.

As the FT argues today, outsourcing in such circumstances risks becoming a Ponzi scheme, where contracts are inherently worth little, but a steady stream of new contracts is needed to maintain the illusion. 

To be sure, incompetence was another factor, with cast cost overruns on major projects driving up debt.

All of this a very far cry from the Left orthodoxy that private companies are coining vast profits from outsourcing. That was so sometimes so in the 2000s, but certainly not today. Indeed, the impact of austerity on the private sector outsourcers needs to be better understood. By both parties.

0 Comments
    Picture

    I was formerly Finance Director of the Prison Service and then Director of the National Offender Management Service responsible for competition. I also worked in the NHS and an IT company. I later worked for two outsourcing companies.

    Now retired, I write about criminal justice policy (or the lack of it), cultivate our allotment and make glass.

    Archives

    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    March 2017
    February 2017
    January 2017
    November 2016
    July 2016
    June 2016
    May 2016
    April 2016

    Categories

    Criminal justice
    EU referendum
    Politics

    All
    EU

    Click below to receive regular updates

    RSS Feed

Proudly powered by Weebly